A third of people in their twenties taking financial advice wished they’d started at an even younger age, according to a new survey by Fairstone.
A further 50% of people polled across all age groups echoed this sentiment, with 98% saying they thought starting a financial plan as early as possible is beneficial.
The findings of the new report by Fairstone, which incorporates one of the largest Chartered planning firms in the UK, are more pertinent with recent government statistics estimating that 10 million people in the UK are expected to live to the age of 100.1
Despite the increased financial pressures this will have on consumers, only around 8% of all UK adults have received financial advice, according to a recent report by the financial services regulator FCA2, with “many consumers still holding money in cash that could be invested to provide higher returns.”
The results of Fairstone’s Annual Client Survey are published today as part of a new report, entitled Changing Landscape: Retirement is not just for the old. The report timely coincides with National Pension Awareness Week, an annual initiative organised by Pension Geeks and supported by the Department for Work & Pensions, which sheds the spotlight on the importance of retirement planning.
For the survey, Fairstone polled over 1,600 of their clients, seeking their attitudes over a range of financial issues from their views on making provision for the fact people are living longer and the importance of investing ethically, to why they chose to take financial advice.
Further highlights of the survey revealed:
- 87% of clients have made provision in their savings for the fact people are living longer
- One in 10 clients aged 65+ started financial advice in their 20s
- 40% of clients started financial advice in their 40s
- 69% of clients have introduced their children/grandchildren to the concept of financial advice
- 42% of women currently invest in responsible portfolios compared to 36% of men
- Women appear to be more risk averse with a third more male than female clients seeing market fluctuations as an opportunity to make investment gains
Fairstone CEO Lee Hartley said that the latest survey painted a changing landscape for the future of financial services and had implications for both financial advisers and their clients.
Mr Hartley added: “One statistic that stood out was that 98% of clients thought that starting a financial plan as early as possible was critically important. This clearly shows that our clients see the value of expert advice with a long-term view to maximise their investments, navigate volatility and achieve financial security.
“On a broader stage though, there is still much to be done across the sector to educate people about the importance of seeking financial advice and the value in starting that journey as early as possible.
“That poses a challenge and a wake-up call to our sector; as financial institutions we need to be focussed on assisting consumers to have access to first-class advice and support at the right time in their lives, to empower and enable them to make better financial decisions.”
Fairstone’s client survey also identified the importance of education and learned behaviour to starting the foundations of financial planning, with nearly 70% of clients surveyed saying that they had introduced their children and/or grandchildren to the concept of financial advice.
Hartley added: “It is important for younger generations to be educated and informed on financial matters to demystify the subject and to empower them with the confidence to start their financial journey early.
“These conversations should start within the family as savings and investment habits develop over a lifetime, with family culture and age all impacting on decisions that are made.
“To support this, we are launching our Junior Finance Academy, which will include educational platforms which have been developed by university academics in partnership with financial institutions, to help inform the children of our clients on important financial issues, in a fun and accessible way.
“As a sector we need to prepare ourselves for the future where the younger generation will be with more money that they are used to having and needing to make it work harder than ever before.”
As part of the new report, Fairstone also published its Annual Client Index, highlighting three tangible outputs: client satisfaction, repeating advice and investment cost savings. The Index showed the firm has 98% client satisfaction, 93% repeating advice and has secured £4.1 million in investment savings for clients.